Explained: Ghana’s water plant deal that produced a $235m judgment debt instead of water for 500,000 people
Fifteen years after Ghana signed a deal to turn seawater into drinking water for Teshie and Nungua, the plant is idle, residents are buying water from tankers, and an international tribunal has ordered the state to pay $235 million to the plant's Spanish owners. That is nearly twice the $126 million the plant cost to build.
Fifteen years after Ghana signed a desalination deal, the Teshie-Nungua plant remains idle, with residents relying on tanker deliveries and an international tribunal has ordered the state to pay $235 million to the Spanish owners. The plant, intended for 500,000 people in Teshie, Nungua, and neighboring communities, was designed to generate 60,000 cubic meters of water daily.
Its service area encompassed Teshie, Nungua, Spintex, Baatsona, and Sakumono. Despite initial promises, construction began two years and eight months after the first water delivery was anticipated. The Ministry of Finance issued a Letter of Comfort and an addendum in 2012, which included a $110 million Water Purchase Agreement and tax waivers.
However, the plant's high cost of water and capacity charges led to significant financial burdens for Ghana Water, with taxpayers covering more than 95% of the expenses.
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